Cityon Systems India Ltd Management Discussions

i. Overview of the business

The Company is engaged in trading activities. The year under review has continued to pose significant challenges, which have adversely impacted the overall performance of the Company. Despite the losses incurred, management remains confident about the long-term viability and growth potential of the business.

During the financial year 2025-26, the Company recorded nil total revenue, as against ?7,5i,740 in the previous financial year, reflecting a significant decline in operations. However, the net loss for the year stood at ^9,00,192, compared to a net loss of ^10,96,322 in FY 2024-25, indicating a reduction in losses over the previous year.

The capital market industry in which the Company operates is highly regulated and exposed to various risks, including technological obsolescence, market volatility, regulatory changes, and potential legal liabilities. The Company continuously monitors these risks and aligns its investment and operational strategies to mitigate their impact and ensure compliance with applicable laws.

The industry outlook remains cautiously optimistic, supported by stabilising inflationary pressures and a gradual recovery in consumer sentiment. The Governments continued emphasis on infrastructure development, digitisation, and manufacturing is expected to generate new opportunities for the sector over the medium to long term.

The Company is equipped with Well-designed controls that streamline processes and operations. The Company is searching for new avenues. Your company continues to focus on the diversification its business activities. Although business opportunities are available, additional resources continue to be constrained for opting for opportunities.

The Company has adequate internal control systems commensurate with its size and nature of business. These controls ensure efficient use and protection of resources, compliance with applicable laws and regulations, and accuracy in financial reporting.

The Company values its human capital and continues to invest in employee training, motivation, and development. As of 31st March 2026, Attrition levels remained within acceptable limits despite industry-wide talent challenges

The Board of Directors affirms that the Company has implemented a comprehensive and effective risk management system in line with industry standards and regulatory requirements. Robust processes are in place to identify, assess, mitigate, and monitor risks across all operational areas. A standardized risk matrix is used to evaluate risks based on their potential impact and likelihood, allowing for proper prioritization and resource allocation. Regular reviews and audits ensure the continued relevance and effectiveness of the framework. The Companys risk appetite is clearly defined and aligned with its strategic goals, with a strong emphasis on fostering a culture of risk awareness and continuous improvement to protect the interests of all stakeholders.

The Company operates in a single business segment. Accordingly, there are no separate reportable business segments requiring disclosure.

The statements made in this report describe the Companys objectives and projections that may be forward-looking statements within the meaning of applicable laws and regulations. The actual result might differ materially from those expressed or implied depending on the economic conditions, government policies and other incidental factors which are beyond the control of the company. The company is not under any obligation to publicly amend, modify or revise any forward-looking statements on the basis of any subsequent developments, information or events.

The Return on Net Worth improved from (0.006) in FY 2024-25 to (0.005) in FY 2025-26. The improvement was primarily attributable to the reduction in the Companys net loss during the year, resulting from lower operating expenses and continued cost optimisation initiatives. Although the Company did not generate revenue from operations during the financial year, the reduction in losses contributed to a marginal improvement in the Return on Net Worth as compared to the immediately preceding financial year.

The Company has prepared its financial statements in accordance with the applicable Indian Accounting Standards/Accounting Standards, as applicable, the provisions of the Companies Act, 2013 and other applicable statutory requirements. No treatment different from that prescribed under the applicable Accounting Standards has been followed in the preparation of the financial statements.